Thursday, May 18, 2006

Over at TechLiberation, Tim Lee points to a paper by Chicago law professor Doug Lichtman on Patent Holdouts, and makes this commentary:

What I found most interesting about the paper, though, is how frankly Lichtman—who I don’t think is a critic of patents generally or software patents in particular—lays out the flaws in the current patent system, especially as it relates to high-tech inventions with hundreds of components. He explains how difficult it is for honest technology creators to discover patents that might be relevant to the technology in development, how the system gives inventors the perverse incentive not to search for relevant patents to avoid treble damages, and how the holder of an undiscovered patent can lie in wait until other companies make significant investments based on their patents and then exort large sums of money from the hapless inventor.

11 Comments:

Anonymous said...

Doug Lichtman, "Law Professor".

Ha-ha-ha

Jackson, stop listening to "law professors" and just listen to somebody with one very valid and very infringed patent.

I chose to publish the patented material in proceedings of a MAJOR technical conference just a few weeks after filing my US patent application.Guess what happpened ? Right.ALL major high-tech companies immediately started using my technology in FULL knowledge of an existing patent application.My patent application is still pending in the USPTO after almost 5 years. I was unable to raise any funding without an issued patent.Everybody and his brother in the industry infringes my patent.What would you do in this situation ? I guess there isn't much to do after that wise Ebay decision by the SCOTUS...(This is actually addressed to Doug Lichtman, "Chicago Law Professor", who sits high in his ivory tower collecting good paychecks as a tenured law professor while calling us, little garage inventors, trolls and patent system abusers)

I wrote a piece of software in 1999 as a graduate student that did something that had never been done before. I was on the cusp of creating a business surrounding this software, and after publishing an academice paper on the topic, found that I was receiving regular email from others interested in using the software commercially (google listed my paper in position #3 on the first page that came up when you entered certain keywords).

Then I received a Cease-and-Desist letter from a Canadian company that had purchased the patent portfolio that allegedly covered my software. The patents in the portfolio dated back to the mid-1980s, yet I was familiar with published papers from the 70s that invalidated many of the claimes. Additionally, the software I had written used entirely new techniques. In short, I was confident that any litigation would have ended up in my favor. I was also fairly certain that a re-exam of the handful of patents would greatly reduce, if not outright invalidate, their power.

But I didn't have the resources to fight this. The $20,000 or so I would have needed to initiate re-exams was more than what I had scraped together to start the business, and filing re-exams would have also caused me to forfeit my right to file a lawsuit against the holder (which would have cost even more).

So, I folded. I took a job with a little contracting firm. Instead of creating jobs, I sucked one up.

Patent Holdouts, as Lichtman calls them, bite. If you are one of them, Mr. Anonymous, you bite.

~30K? Ha. that's nothing my friend. I burned through at least twice that developing my software, and it was all for naught because of idiot patent holders who think they own unoriginal, overly-broad patents. Seriously -- the backbone of their portfolio covered, essentially, recording statistics about how a user gave input to the computer.

I don't know what your patent covers, and I don't know if you ever did anything more than tinker with an idea and daydream. But your biggest mistake was probably handing money over the patent attorneys and the USPTO. You'll never get a dime out of that -- the USPTO is the servant of corporations, and always will be, as long as holding a patent gives you "rights" that can only be enforced in a court of law.

Seriously, you would rather raise $10-$20 million to defend your patent than raise the same amount to invest in producing your invention? That is screwed up, man. Screwed up.

I totally sympathize with the lost hours, man. I'd dumped a bunch into writing my software, too. Lots of evenings, lots of time I could have been spending with the wife and kids. All stolen from me because the patent system allows people and corporations to "own" obvious ideas. It's ridiculous.

And in my case, the patent holder produced software that was similar (but far inferior). They have a complete monopoly on the entire niche field, because they have patents. The earliest patent they had has since expired, but it doesn't matter -- they've got other patents that cover the exact same things with different verbiage but including slight modifications and improvements. And their product is still inferior, and always will be until they have competition that makes it better. Their customers are getting the shaft because their product sucks. I got the shaft because I didn't get in early enough to do a massive IP land-grab before they did. The entire economy gets the shaft because consumers don't get the benefits of my solution (or of other's solutions) because the government saw fit to hand out an arbitrary monopoly.

And there is no way I could have seen it coming, no way I could have known that their patents even existed -- they don't show up under the keywords you would expect. I suppose I could have shelled out hundreds of bucks to a patent search expert before I ever even thought about writing code, but come on, that's an insane requirement (imagine if every novelist had to do that before they ever put pen to paper)! And a patent searcher might not have been able to find these obscure patents, either.

A prior-art patent search probably wouldn't have helped you anyway -- take a look at the case of Bob Jacobsen, who published his software quite some time before any patent issued (not to mention that the patent in question covers techniques well-known decades before the patent application was filed)

This whole patent thing can prove to be frustrating, dejecting and inutile. Theft of ideas has become rampant all because these thieves saw much money-making potential. There should be stricter penalties about blatant use of other people's ideas and more protection for the discovers.

It may be niave of me to think this, but it seems that we - collectively as a society - have the notion of patents and copyrights the wrong way round. These concepts were developed to protect individuals and their creations, yet now it seems more and more that they are there principally to protect commercial organisations. I mean which individual has the funds to defend an infringement of their patent? Likewise which individual has the funds to defend themselves against claims copyright infringement from Sony or other industry labels?

What has happened to the notion of protecting the individuals who without some state protection are left vulnerable to abuse?

Is this just the case with patents or does it extend to all areas of copyright etc? I'm just interested because I'm looking into how best to cover myself in terms of copyrights and trademarks. How can you best protect yourself so that you can market a product and not get ripped off by someone stealing your idea - especially businesses with the money to just blow you out of the water?

Patents, like any other area of civil law only have any use if you can afford the litigation costs. Take a look at the number of land ownership cases that are righful, yet fail because the plaintiff just doesn't have the money to go up against the big boys.

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